The limit for contactless payments has been increased to £30 following a sharp increase in the number of transactions carried out by the method. Payment terminals were updated to accept the new limit from Tuesday 1st September to ensure national coverage.
The decision to raise the limit was taken collectively after extensive consultation with all of the parties in the cards payments industry.
More than £2.5bn was spent using contactless cards in the first half of 2015, new data from The UK Cards Association shows, compared with £2.32bn for the whole of 2014. Contactless spending has risen from £287m per month in January 2015 to £567m in June 2015.
Graham Peacop, Chief Executive Officer of The UK Cards Association, said: “Contactless payments are fast, easy and secure. With more contactless cards in wallets than ever before and a growing number of retailers accepting contactless payments, we have seen a huge rise in the number of payments being made,” he says. “The growth in contactless payments shows people want to use contactless cards and increasing the limit gives customers even more opportunities to pay in this way.”
The technology is ideally suited for convenience stores, with fraud on contactless cards extremely low, at less than one penny for every hundred pounds spent, and the vast majority of basket spend under the limit.
The average supermarket spend of £25 now falls below the contactless limit, giving shoppers more choice about the way they can pay for their goods. The average card spend in pubs, cinemas, dry cleaners, pet shops and gift shops also falls under the new £30 limit.
There are more than 69 million contactless payment cards in circulation. More than 9.3 million contactless payment cards were issued to consumers between January and June 2015.
Kevin Jenkins, Managing Director UK & Ireland at Visa Europe, said: “Contactless is becoming the ‘new normal’. This threshold increase to £30 gives consumers all the benefits of contactless across a broader range of their daily activities, and we expect to see this momentum continue to build as more people adopt mobile and wearable payment technology.”
Mark Barnett, President of MasterCard UK & Ireland, added:“ The pace of growth we are seeing in contactless is getting ever faster as we rely less and less on cash. Consumers enjoy the speed and convenience of tapping to pay. We expect this upward trend to persist with consumers continuing to migrate to contactless card payments and increasingly to mobile payments, as we work with partners such as Apple to enable more convenient ways to pay.”
Ray Brash, MD & Chairman at PrePay Solutions, said: “The average value of card transactions has been falling for a while now, as people continue to opt for greater convenience and become familiar with the technology. Contactless has become the norm for many transactions; as a retailer it has become vital to adopt the technology. You don’t want to answer the statement or question ‘go contactless’ with an embarrassed, sorry, we don’t do contactless.”